According to the research, 26% of potential FTBs say they’ve moved back in with parents so they can save as much as possible while 30% have stopped going on costly holidays.
Around 61% say they have cut back on socialising while 55% have cut general spending on themselves and loved ones. Around one in 12 (8%) have even postponed starting a family or getting married while 7% have sold their car and now rely on public transport so they can maximise their savings.
But The Nottingham’s research found one in three (32%) saving to buy their first home in the next five years have not heard of helpful accounts that can boost their savings, such as the Help to Buy ISA, and less than half (48%) have taken advantage of a Government scheme. Savers aged 18 to 24 are the least likely to know about financial benefits of ISAs that are available with 44% admitting they’re not aware.
HMRC figures show 166,000 Lifetime ISAs (LISAs) worth £517 million and averaging £3,144 per account were opened in the 2017/18 tax year but hundreds of thousands are missing out.
The Nottingham is supporting first-time buyers further by providing free access to its whole of market mortgage service, that usually costs £249, to its LISA savers following the launch last month.
Simon Taylor, The Nottingham’s Chief Operating Officer, commented: “First-time buyers face a lot of challenges getting a deposit together, so it’s important to us to raise awareness of all the help and financial benefits that are on offer with the right accounts.
Our research shows people are making financial sacrifices to get on the ladder and they deserve some help. Thanks to the significant bonuses available, paying into a government-backed savings account, such as a Lifetime or Help-to-buy ISA, will enable first-time buyers to save a deposit more quickly or put down a larger deposit which can increase their options.
The help isn’t just for there for first-time buyers either as the Lifetime ISAs can be used by savers wanting to boost their retirement savings also.”
First-time buyers are eligible for up to £1,000 of cash bonuses every year and The Nottingham is one of just two providers to offer the Cash LISA, and the only provider that allows customers to open the account with just £10 face-to-face via one of its 67 branches. As well as the 25% bonus, The Nottingham will pay 1.00% AER interest tax free, on the savings balance every year.
